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Don’t be fooled; the correction has just begun

Investors seem to think the long-awaited correction has come and gone, which explains why stock have rallied so strongly off of the recent lows. The problem is that the S&P 500 only fell by about 9% from the recent all-time high – not enough to qualify as a true correction, much less a significant retracement to more reasonable valuations for stocks. The underlying issues that brought-on the selling of last week – fears over rising interest rates, the strengthening dollar, disappointing earnings, global economic slowing, etc. – are still alive and well. Astute investors should be selling into this rally, if they haven’t sold already.

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